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Investing.com – The Dow snapped a three-day winning streak Wednesday as investor optimism over the path of an economic recovery was kept in check by a rise in Covid-19 infections across parts of the U.S.
The Dow Jones Industrial Average fell 0.65%, or 170 points, the S&P 500 slipped 0.36%, while the Nasdaq Composite was up 0.15%.
A rise in infections in some states, including Arizona, Florida, and Texas, stoked fears that lawmakers may move to roll back the relaxation of some restrictions, leading some to rein in some of the bullish bets on stocks tied to progress of the economic reopening.
United Airlines (NASDAQ:UAL), Royal Caribbean Cruises (NYSE:RCL) and Marriott International (NASDAQ:MAR) were among the worst hit.
Energy, which has ridden the wave of reopening optimism in recent weeks, led the broader market lower as concerns about crude demand were exacerbated by a surprise build in weekly crude supplies.
Weekly U.S. crude supplies climbed 1.2 million barrels last week, confounding expectations for a draw of 152,000 barrels.
In tech, meanwhile, social media companies came under fire on reports that the Department of Justice was looking into reforms that aim to weaken a legal protection that shields them from liability over content posted on their platforms.
Facebook (NASDAQ:FB) and Twitter (NYSE:TWTR) turned negative after paring gains, but Snap (NYSE:SNAP) was up more than 3%.
On the monetary policy front, Federal Reserve Chairman Jerome Powell, in testimony before the House Financial Services Committee, said that the Fed will move away from buying exchange traded funds (ETFs) invested in bonds and instead purchase mostly individual corporate bonds.
“Over time we’ll gradually move away from ETFs and move to buying bonds,’ Powell said, according to CNBC. “It’s a better tool for supporting liquidity and market functioning.”
Powell also stressed that Fed’s corporate bond-buying will be at the “bottom end” of the possible range because markets are functioning well.
